<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C.  20549

                                    FORM 10-Q

(MARK  ONE)

 [x] QUARTERLY  REPORT  PURSUANT  TO  SECTION  13 OR 15(d) OF THE SECURITIES AND
     EXCHANGE  ACT  OF  1934.

For  the  quarterly  period  ended  June  30,  2003

                                       OR

[ ]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13  OR  15(d)  OF THE SECURITIES
     EXCHANGE  ACT  OF  1934.

     For  the  transition  period  from  __________  to  ___________

                                    000-30051
                               -------------------
                              (Commission File No.)

                             PAVING STONE CORPORATION
             -----------------------------------------------------
             (Exact name of registrant as specified in its charter)

           NEVADA                              88-043120
- --------------------------        -------------------------------------
(State  of  Incorporation)        (I.R.S.  EmployerIdentification  No.)

                  9900 West Sample Road, Suite 300, Coral Springs, FL 33065
                 ------------------------------------------
                    (Address of principal executive offices)

                                 (954) 971-3235
                           ---------------------------
                         (Registrant's telephone number)

                             Cottage Investments, Inc.
                           ---------------------------
                           (Registrant's Former Name)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  12  months  (or  for such shorter period that the Registrant was
required  to  file  such  reports),  and  (2)  has  been  subject to such filing
requirements  for  the  past  90  days.  Yes X   No

Indicate  by  check  mark  whether  the  registrant  is an accelerated filer (as
defined  in  rule  12b-2  of  the  Exchange  Act). Yes     No X

At  November 12,  2003,  44,400,282 shares of the Registrant's common stock were
issued  and  outstanding.

Throughout  this  Report, the terms "we", "us", "our" and other similar pronouns
refer  to  the  Paving  Stone  Corporation.  The terms "PVNG", the "Company," or
"Registrant"  also  refer  to  the  Paving  Stone  Corporation.

<PAGE>


PART  I:     FINANCIAL  INFORMATION.

ITEM  1.     FINANCIAL  STATEMENTS.
                            PAVING STONE CORPORATION
                                AND SUBSIDIARIES
                             CONDENSED CONSOLIDATED
                              FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003

<PAGE>

                            PAVING STONE CORPORATION
                                AND SUBSIDIARIES

                                    CONTENTS

PAGE     1     CONDENSED CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 2003
               (UNAUDITED) AND DECEMBER 31, 2002

PAGE     2     CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND
               SIX MONTHS ENDED JUNE 30, 2003 AND 2002 (UNAUDITED)

PAGES    3     CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX
               MONTHS ENDED JUNE 30, 2003 AND 2002 (UNAUDITED)

PAGES 5 - 11   NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF JUNE
               30, 2003 (UNAUDITED)

<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                ASSETS
                                                                                     June 30, 2003       December 31,
                                                                                      (Unaudited)            2002
                                                                                     -------------       ------------
<S>                                                                                   <C>                <C>
CURRENT ASSETS
 Cash                                                                                 $     62,931       $     15,639
 Accounts receivable - net                                                                 686,813          1,261,801
 Costs in excess of billings on uncompleted contracts                                           --            159,335
 Inventory                                                                               1,350,000                 --
 Prepaid expenses                                                                              663              4,738
 Net assets of discontinued operations                                                     104,098          2,513,620
                                                                                      ------------       ------------
        Total Current Assets                                                             2,204,505          3,955,133
                                                                                      ------------       ------------

PROPERTY AND EQUIPMENT - NET                                                               146,801            108,111
                                                                                      ------------       ------------

OTHER ASSETS
 Security deposits and other assets - net of amortization                                    4,470             23,225
 Other loans/advances receivable                                                             3,497              2,391
                                                                                      ------------       ------------
        Total Other Assets                                                                   7,967             25,616
                                                                                      ------------       ------------

TOTAL ASSETS                                                                          $  2,359,273       $  4,088,860
                                                                                      ============       ============

                        LIABILITIES AND STOCKHOLDERS' DEFICIENCY
CURRENT LIABILITIES
 Cash overdraft                                                                       $         --       $     78,393
 Line of credit                                                                          2,507,010          2,502,588
 Accounts payable and accrued expenses                                                   2,561,447          2,235,023
 Accrued stock compensation                                                                 55,000            102,123
 Billings in excess of cost on uncompleted contracts                                            --            218,317
 Note and capital lease obligation payable - current portion                                71,708             38,330
 Notes payable - stockholder                                                               130,628                 --
 Note payable - related party                                                              700,000                 --
 Net liabilities of discontinued operations                                              2,513,946          3,672,450
                                                                                      ------------       ------------
        Total Current Liabilities                                                        8,539,739          8,847,224
                                                                                      ------------       ------------

LONG TERM LIABILITIES
 Note and capital lease obligation payable                                                      --             61,814
 Notes payable - stockholder                                                                    --            143,047
 Note payable - related party                                                                   --            700,000
                                                                                      ------------       ------------
        Total Long-Term Liabilities                                                             --            904,861
                                                                                      ------------       ------------

TOTAL LIABILITIES                                                                        8,539,739          9,752,085
                                                                                      ------------       ------------

STOCKHOLDERS' DEFICIENCY
 Common stock, $.00001 par value, 150,000,000 shares authorized, 43,680,282, and
  26,177,382 shares issued and outstanding, respectively                                       436                262
 Common stock to be issued, none and 779,300 shares, respectively                               --                  8
 Additional paid-in capital                                                              7,997,457          6,498,322
 Accumulated deficit                                                                   (14,178,359)       (12,161,817)
                                                                                      ------------       ------------

TOTAL STOCKHOLDERS' DEFICIENCY                                                          (6,180,466)        (5,663,225)
                                                                                      ------------       ------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY                                        $  2,359,273       $  4,088,860
                                                                                      ============       ============
</TABLE>

     See accompanying notes to condensed consolidated financial statements.


                                       1
<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                          For the Three       For the Three      For the Six        For the Six
                                                           Months Ended       Months Ended       Months Ended       Months Ended
                                                          June 30, 2003       June 30, 2002      June 30, 2003      June 30, 2002
                                                          -------------       -------------      -------------      ------------
<S>                                                        <C>                <C>                <C>                <C>
NET SALES                                                  $  1,831,426       $  4,084,668       $  4,625,221       $  6,618,540

COST OF SALES                                                 1,494,935          2,667,005          3,504,806          4,437,462
                                                           ------------       ------------       ------------       ------------

GROSS PROFIT                                                    336,491          1,417,663          1,120,415          2,181,078
                                                           ------------       ------------       ------------       ------------

OPERATING EXPENSES
  Selling, general and administrative                           830,553          1,607,616          1,783,477          2,600,755
  Common stock issued for services                              143,531            105,000            248,591            105,000
  Common stock returned in consultant settlement                     --           (615,700)                --           (615,700)
                                                           ------------       ------------       ------------       ------------
       Total Operating Expenses                                 974,084          1,096,916          2,032,068          2,090,055
                                                           ------------       ------------       ------------       ------------

(LOSS) INCOME FROM CONTINUING OPERATIONS                       (637,593)           320,747           (911,653)            91,023
                                                           ------------       ------------       ------------       ------------

OTHER EXPENSE
  Interest expense                                               27,479              9,319             75,501             10,815
  Other expense                                                   3,641              1,104                178              1,104
                                                           ------------       ------------       ------------       ------------
       Total Other Expense                                       31,120             10,423             75,679             11,919
                                                           ------------       ------------       ------------       ------------

(LOSS) INCOME FROM CONTINUING OPERATIONS                       (668,713)           310,324           (987,332)            79,104

LOSS FROM DISCONTINUED OPERATIONS                              (735,823)          (289,893)        (1,128,500)          (556,639)
                                                           ------------       ------------       ------------       ------------

NET (LOSS) INCOME                                          $ (1,404,536)      $     20,431       $ (2,115,832)      $   (477,535)
                                                           ============       ============       ============       ============

NET LOSS PER SHARE - BASIC AND DILUTED
 (Loss) income from continuing operations                  $       (.02)      $        .01       $       (.03)      $        .00
 (Loss) from discontinued operations                               (.02)              (.01)              (.04)              (.02)
                                                           ------------       ------------       ------------       ------------
                                                           $       (.04)      $       (.00)      $       (.07)      $       (.02)
                                                           ============       ============       ============       ============

Weighted average shares outstanding during the period
 - basic and diluted                                         32,078,903         24,302,951         29,285,195         23,158,922
                                                           ============       ============       ============       ============
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                       2
<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                                    2003              2002
                                                                                                -----------       -----------
<S>                                                                                             <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 (Loss) income from continuing operations                                                       $  (987,332)      $    79,104
 Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
  Stock issued for services                                                                         248,591           105,000
  Stock returned in consultant settlement                                                          (615,700)
  Loss from discontinued operations                                                              (1,128,500)         (556,639)
  Depreciation                                                                                       37,352            46,422
  Amortization                                                                                        6,250             9,680
  Bad debt expense                                                                                   78,234           (12,760)
  Loss on disposal of property and equipment                                                         65,503             1,104
 Changes in operating assets and liabilities:
  (Increase) decrease in:
    Accounts receivable                                                                             496,754         1,266,332
    Prepaid expense                                                                                  (2,175)           41,109
    Security deposits and other assets                                                               17,649            (9,232)
    Costs in excess of billings on uncompleted contracts                                            159,335          (342,825)
    Other receivables                                                                                    --           (40,245)
    Net assets of discontinued operations                                                         2,267,977                --
  Increase (decrease) in:
    Accounts payable and accrued expenses                                                           326,424          (650,714)
    Billings in excess of cost on uncompleted contracts                                            (218,317)          (89,568)
    Accrued stock compensation                                                                      (47,123)               --
    Customer deposits payable                                                                            --           (83,641)
    Net liabilities of discontinued operations                                                   (1,158,504)               --
                                                                                                -----------       -----------
         Net Cash Provided By (Used In) Operating Activities                                        162,118          (852,573)
                                                                                                -----------       -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
 Proceeds on disposal of equipment                                                                       --            37,828
 Purchase of property and equipment                                                                      --           (40,470)
 Other loans/advances receivable                                                                         --            (6,800)
                                                                                                -----------       -----------
         Net Cash Used In Investing Activities                                                           --            (9,442)
                                                                                                -----------       -----------

CASH FLOWS FROM FINANCING ACTIVITIES
 Cash overdraft                                                                                     (78,393)         (288,778)
 Proceeds on issuance of stock for cash, net                                                             --         1,000,000
 Line of credit                                                                                       4,422           268,215
 Advances from related parties                                                                           --          (113,602)
 Payments on notes and capital lease obligations                                                    (28,436)          (57,439)
 Shareholder loan payable                                                                           (12,419)           18,180
                                                                                                -----------       -----------
         Net Cash (Used In) Provided By Financing Activities                                       (114,826)          826,576
                                                                                                -----------       -----------

NET INCREASE (DECREASE) IN CASH                                                                      47,292           (35,439)

CASH - BEGINNING OF PERIOD                                                                           15,639            35,439
                                                                                                -----------       -----------

CASH - END OF PERIOD                                                                            $    62,931       $        --
                                                                                                ===========       ===========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid for interest                                                                          $    81,405       $    61,068
                                                                                                ===========       ===========

NON-CASH INVESTING AND FINANCING ACTIVITIES:

Equipment acquired by note payable                                                              $        --       $    42,377
                                                                                                ===========       ===========

Purchase of inventory for common stock                                                          $ 1,350,000       $        --
                                                                                                ===========       ===========
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                       3
<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                                   (UNAUDITED)

NOTE 1 BASIS OF PRESENTATION

      The accompanying unaudited condensed consolidated financial statements
      have been prepared in accordance with accounting principles generally
      accepted in the United States of America and the rules and regulations of
      the Securities and Exchange Commission for interim financial information.
      Accordingly, they do not include all the information necessary for a
      comprehensive presentation of the Company's consolidated financial
      position and results of operations.

      It is management's opinion, however that all material adjustments
      (consisting of normal recurring adjustments) have been made which are
      necessary for a fair financial statements presentation. The results for
      the interim period are not necessarily indicative of the results to be
      expected for the year.

      The condensed consolidated balance sheet information as of December 31,
      2002, was derived from the audited consolidated financial statements
      included in the Company's Annual Report Form 10-KSB. It is suggested that
      the interim condensed consolidated financial statements be read in
      conjunction with the audited financial statements for the year ended
      December 31, 2002, as filed with the Securities and Exchange Commission on
      Form 10-K, from which the interim statements were derived.

      In preparing condensed consolidated financial statements in conformity
      with accounting principles generally accepted in the United States of
      America, management is required to make estimates and assumptions that
      affect the reported amounts of assets and liabilities and the disclosure
      of contingent assets and liabilities at the date of the condensed
      consolidated financial statements and revenues and expenses during the
      reported period. Actual results could differ from those estimates.

NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      (A) Principles of Consolidation

      The accompanying condensed consolidated financial statements include the
      accounts of Paving Stone Corporation and its wholly owned subsidiaries.
      All significant inter-company transactions and balances have been
      eliminated in consolidation.

      (B) Fair Value of Financial Instruments

      The carrying value of financial instruments including receivables,
      accounts payable, accrued expenses and debt, approximates fair vales at
      June 30, 2003 and December 31, 2002 due to the


                                       4
<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                                   (UNAUDITED)

      relatively short-term nature of these instruments.

      (C) Loss Per Common Share

      Net loss per common share (basic and diluted) is based on the net loss
      divided by the weighted average number of common shares outstanding during
      each year. Common stock equivalents are not included in the computation of
      diluted net loss per common share because the effect would be
      anti-dilutive.

NOTE 3 INVENTORY

      During the second quarter of 2003, the Company formed a wholly owned
      subsidiary, PSC Equipment, Inc., to purchase and sell high-grade
      commercial equipment. On May 30, 2003, the Company entered into an
      Equipment Purchase Agreement ("EPA") with a vendor and purchased its first
      block of equipment inventory. Under the EPA, the Company issued 15,000,000
      restricted shares of its common stock and executed a $500,000 Money
      Purchase Contract for the equipment inventory. The inventory is located at
      four sites around the U.S.A. and will remain there until sold. Under the
      EPA, the Company is not required to make lease, storage fee or insurance
      payments for two years. The inventory is valued at $1,350,000 on the
      condensed consolidated balance sheet as of June 30, 2003, based on the
      value of the shares on the date of the EPA. The $500,000 money purchase
      contract is not recorded as a liability on the condensed consolidated
      balance sheet as of June 30, 2003 since it is contingent on the Company
      obtaining cash proceeds from the sale of the inventory or from financing
      secured by the inventory (See Note 10).

      On June 25, 2003, the Company executed a second Equipment Purchase
      Agreement ("EPA-2") with a vendor to purchase additional equipment
      inventory located in one site in Texas. Under EPA-2, the Company is
      obligated to pay for the inventory under a Money Purchase Contract using
      900,000 shares of stock from the ultimate purchaser of the inventory. As
      of June 30, 2003, the Company had not yet sold the inventory and therefore
      had not yet made a payment under the Money Purchase Contract. As such, the
      inventory is not valued on the June 30, 2003 balance sheet since EPA-2 was
      not fully consummated. See Note 10 for the final consummation of this
      transaction.

NOTE 4 DISCONTINUED OPERATIONS

      During December 2002, the Company made the decision to discontinue its
      Florida and New England Paving Stone operations. As of June 30, 2003, the
      Florida and New England operations are completely discontinued. Both
      operations have been accounted for as discontinued operations and
      accordingly, amounts in the condensed consolidated financial statements
      and related notes for all periods shown, reflect discontinued operations
      accounting.


                                       5
<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                                   (UNAUDITED)

      Concurrently, the Company entered into an agreement to assist a contractor
      in acquiring all the Company's former customers in various Florida
      markets. The agreement calls for the Company to receive a commission of 5%
      of the actual gross margin earned during 2003. Through June 30, 2003, the
      Company has not recorded any commissions under the contract. The Company
      expects its Arizona/Texas, Georgia/Mid-Atlantic, Nevada and California
      operations to be completely discontinued by the end of the third quarter.

      Information relating to the Florida and New England operations for the six
      months ended June 30, 2003 and 2002 are as follows:

                                                 2003                   2002
                                             -----------            -----------

Revenues                                     $   919,453            $ 9,231,919
Costs and expenses                             2,047,953              9,788,558
                                             -----------            -----------

    Net (Loss)                               $(1,128,500)           $  (556,639)
                                             ===========            ===========

Assets and liabilities of the discontinued operations were as follows:

                                               June 30, 2003   December 31, 2002
                                               -------------   -----------------
Assets
 Accounts receivable, net                       $    85,619       $1,995,086
 Cost in excess of billings                              --          288,828
 Inventories                                             --           17,500
 Property and equipment                              20,479          184,816
 Other assets                                        (2,000)          27,390
                                                -----------       ----------

    Total Assets                                $   104,098       $2,513,620
                                                ===========       ==========

Liabilities
 Cash overdraft                                 $    91,363       $  249,618
 Billing in excess of cost                               --          735,250
 Accounts payable and accrued expenses            2,422,583        2,687,582
                                                -----------       ----------

    Total Liabilities                           $ 2,513,946       $3,672,450
                                                ===========       ==========

NOTE 5 SEGMENT REPORTING

The Company has six geographic reportable segments: Arizona, Atlanta, Nevada,
California, Corporate and PSC Equipment. Each segment, with the exception of PSC
Equipment, installs


                                       6
<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                                   (UNAUDITED)

interlocking pavers on driveways and patios for residential and commercial use.
The Company evaluates segment performance based on income (loss) from
operations. Sales for each segment are based on the location of the third-party
customer. All intercompany transactions between segments have been eliminated.
The Company's selling, general and administrative expenses and engineering
expenses are charged to each segment based on the region where the expenses are
incurred. As a result, the components of operating income (loss) for one segment
may not be comparable to another segment. Segment results for the six months
ended June 30, 2003 and 2002 are as follows:

<TABLE>
<CAPTION>
                           Arizona/      Georgia/                                                 PSC
                            Texas      Mid-Atlantic     Nevada      California     Corporate   Equipment        Total
                         -----------   ------------    ---------    -----------    ---------   ---------     -----------
<S>                      <C>            <C>            <C>          <C>            <C>          <C>          <C>
2003

Net sales                $ 1,749,631    $ 1,616,704    $ 439,099    $   486,306    $ 333,481    $       --   $ 4,625,221

(Loss) from operations      (158,165)       (45,019)     (33,462)      (506,637)    (244,049)           --      (987,332)

Depreciation and
 amortization                  2,187          5,114          623          4,841       13,379            --        26,144

Assets                       274,989        444,030       33,119         75,913       77,124     1,350,000     2,255,175

2002

Net sales                $ 2,482,496    $ 1,443,277    $ 824,647    $ 1,868,119    $  52,814    $       --   $ 6,671,353

Income (loss) from
 operations                  189,438        (21,437)     (12,158)      (525,522)     393,635            --        23,956

Depreciation and
 amortization                  1,495          6,233          934            931           --            --         9,593

Assets                       790,294        807,564      282,250        410,020       83,828            --     2,373,956

Capital expenditures           6,213         42,377           --          5,912        8,572            --        63,074
</TABLE>

NOTE 6 STOCK ISSUANCES

      During the six months ended June 30, 2003, the Company issued 2,123,000
      shares of common stock to consultants for services. The shares were valued
      at $238,917, the fair market value based on closing prices on the
      respective issuance dates.

      During the six months ended June 30, 2003, the Company issued 600,000
      restricted shares of common stock as collateral for services performed by
      a vendor. These shares have not yet been applied as payment for amounts
      owed (See Note 7(B)).

      During the six months ended June 30, 2003, the Company issued 2,066,500
      shares of common stock as collateral for amounts owed for services
      performed by consultants and vendors. The vendors exercised their option
      to convert $9,674 of the amount owed into 105,700 shares of the Company's
      common stock and based on the dates exercised. The remaining 1,960,800
      option shares were collateral at June 30, 2003 (See Note 7(B)).

      During the six months ended June 30, 2003, the Company issued 15,000,000
      restricted shares of common stock to purchase commercial equipment
      inventory in conjunction with its equipment re-sale subsidiary, PSC
      Equipment, Inc. The shares were valued at $1,350,000, based on the closing
      market price of the Company's common stock on the date of the equipment
      purchase transaction.


                                       7
<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                                   (UNAUDITED)

NOTE 7 COMMITMENTS AND CONTINGENCIES

      (A) Ongoing Litigation

      The Company is currently in a contractual dispute over agreements to issue
      1,175,119 shares of common stock to former consultants. A legal opinion
      has been issued to the transfer agent requesting to stop the transfer of
      395,819 previously issued shares and the remaining 779,300 shares have not
      been issued, pending a resolution of this dispute.

      The Company is presently a defendant in twenty-five collection related
      lawsuits totaling approximately $520,000, some of which judgments have
      been obtained and some are pending. The majority of these legal actions
      are a result of the Company's discontinued operations. Additionally, there
      are presently eighteen potential lawsuits which are all collection related
      matters totaling approximately $200,000.

      (B) Collateralized Shares

      During the six months ended June 30, 2003, the Company issued 2,560,800
      shares of common stock as collateral for amounts owed for services
      previously performed by vendors. The amounts due to these vendors are
      recorded in accounts payable and accrued expenses as of June 30, 2003.
      Upon payment of these outstanding invoices by the Company, the shares will
      be returned to the Company and canceled. In addition, the vendor has the
      option to satisfy amounts owed to them, after notifying the Company, by
      either selling the shares in the open market or accepting the shares in
      lieu of full payment of the debt. As of the date of this report, no shares
      have been returned.

      (C) Payroll and Payroll Taxes

      As of June 30, 2003, the Company owes approximately $123,000 of payroll
      and payroll taxes to its payroll processing company. This amount has been
      accrued and is included in accounts payable and accrued expenses. On
      August 1, 2003 the payroll processing company filed a civil action summons
      for the payroll and payroll tax deficiency plus accrued interest at the
      rate of 1.5% per month.


                                       8
<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                                   (UNAUDITED)

      (D) Lack of Insurance

      As of June 30, 2003, the Company has not maintained any liability
      insurance or any other form of insurance. The Company is also lacking
      insurance coverage for workman's compensation, disability and directors
      and officers liability insurance. Although the Company is not aware of any
      claims arising subsequent to June 30, 2003, there is no assurance that
      none exist.

      (E) Capitalized Leases

      As of June 30, 2003, the Company was in default of capitalized equipment
      leases. Certain of the assets pertaining to the leased equipment were
      repossessed and as such have been removed from the Company's possession.
      There is no assurance that legal action will not be taken against the
      Company for the shortfalls on the balance of the leases.

Amount of assets taken off books                                         $26,892
                                                                         -------

Amount of debt taken off books                                           $20,632
                                                                         =======

NOTE 8 RELATED PARTIES

      During the six months ended June 30, 2003, the Company repaid stockholder
      loans in the amount of $12,419.

NOTE 9 GOING CONCERN

      As reflected in the accompanying condensed consolidated financial
      statements, the Company has a net loss of $2,115,832 for the six months
      ended June 30, 2003, a working capital deficiency of $6,335,234 and a
      stockholders' deficiency of $6,180,466. These factors raise substantial
      doubt about its ability to continue as a going concern. The ability of the
      Company to continue as a going concern is dependent on the Company's
      ability to raise additional funds and implement its business plan. The
      condensed consolidated financial statements do not include any adjustments
      that might be necessary if the Company is unable to continue as a going
      concern.

      Management has discontinued its Florida and New England operations and
      expects to discontinue all paver installation segments as of September 30,
      2003 and has consolidated its California operations into one central
      office. Management has also reduced other operating expenses during 2003
      throughout the Company to return to profitable operations during 2003.


                                       9
<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                                   (UNAUDITED)

      Management's future plans also include restructuring its revolving line of
      credit for which they are currently in active negotiations with a
      financial institution.

NOTE 10 SUBSEQUENT EVENT

      (A) Equipment Inventory Sale

      On July 29, 2003, the Company sold a portion of the first block of
      equipment inventory acquired on May 30, 2003, under an EPA to a public
      company located in the southwest U.S.A. Under the EPA, the selling price
      was $7,500,000 comprising a $500,000 Money Purchase Contract, 7,000,000
      shares of the purchasers restricted common stock valued at $3,500,000, and
      7,000,000 shares of the purchasers convertible preferred stock valued at
      $3,500,000. The valuation of both the preferred and common stock was based
      on the fair market value of the public company's common stock as
      determined by recent sales of the stock in private placements.

      On September 18, 2003, the Company executed an amendment to the July 29th
      $7,500,000 EPA as follows:

      1.    The Company purchased a new block of inventory using 1,800,000 of
            the common shares received in the original July 29, 2003 transaction
            per above and an additional 900,000 of these common shares were used
            to fully consummate the EPA dated June 25, 2003 as described in the
            Inventory footnote.

      2.    The original inventory sold as per the July 29, 2003 EPA was swapped
            in its entirety for the two blocks of inventory described above.

      The cost basis of the inventory sold in the $7,500,000 transaction was
      based on the 2,700,000 common shares received from the purchaser, valued
      at $1,350,000, which were used to acquire the applicable blocks of
      inventory. The net sales proceeds in the transaction exclude the $500,000
      Money Purchase Contract portion, since this amount has not yet been
      received. Below is a summary of how the transaction was recorded during
      the third quarter of 2003.

Sales                                                                 $7,000,000
Less cost of goods sold inventory                                      1,350,000
Less commissions and other expenses (3,500,000 shares @$.50)           1,750,000
                                                                      ----------

Net profit                                                            $3,900,000
                                                                      ----------

Stock held by purchaser (7,800,000 shares @ $.50)                     $3,900,000
                                                                      ----------


                                       10
<PAGE>

                    PAVING STONE CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               AS OF JUNE 30, 2003
                                   (UNAUDITED)

      Had this transaction been consummated prior to June 30, 2003, the second
      quarter consolidated results would have been as follows:

Net profit for the 3 months ended March 31, 2003                    $ 2,495,464
Earnings per share                                                  $       .08

Net profit for the 6 months ended June 30, 2003                     $ 1,784,168
Earnings per share                                                  $       .06

Total assets at June 30, 2003                                       $ 6,259,272

Total stockholders' deficiency at June 30, 2003                     $(2,280,466)

      (B) Stock and Option Activity

      Subsequent to June 30, 2003, 300,000 shares of common stock held as
      collateral by consultants and vendors was applied as payment for amounts
      owed. The common stock was valued at $24,000 on the date applied to the
      debt.

      Subsequent to June 30, 2003, the Company issued 720,000 shares to
      consultants and vendors pursuant to its stock compensation plans, as
      payment for fees owed. The shares were valued at $51,300 based on the
      dates of issuance.

      Subsequent to June 30, 2003, the Company issued 925,000 shares of common
      stock to consultants and vendors as collateral for amounts owed for
      services to be performed.

      (C) Revolving Line of Credit

      The Company had a revolving line of credit with a financial institution
      with a maximum line of $2,500,000. The line of credit is payable on demand
      with interest at the 30-day dealer commercial paper rate plus 2.55%. It is
      secured by all the assets of the Company and Paving Stone Industries,
      Inc., a corporation owned by the majority stockholder. The line of credit
      was due for renewal as of April 30, 2003, and has not been renegotiated
      for the renewal as of the date of this report. The financial institution
      is currently negotiating a forbearance agreement with the Company to
      restructure the debt.


                                       11
<PAGE>


ITEM  2.     MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF FINANCIAL CONDITION AND
RESULTS  OF  OPERATIONS.

FORWARD-LOOKING  STATEMENTS

     This  quarterly  report  on  Form  10-Q contains forward-looking statements
within  the  meaning  of  the  Private Securities Litigation Reform Act of 1995.
Words  such  as  "anticipates",  "believes",  "forecasts",  "plans",  "hopes",
"predicts",  "prognosticates",  and  the  like  are  meant to indicate that such
statements are forward-looking and not historical in nature, and such statements
contain  inherent risks and uncertainties which render them capable of not being
achieved.  Forward-looking  statements  involve  known  and  unknown  risks,
uncertainties  and  other  factors  which  could  cause  the  actual  results,
performance  (financial  or operating) or achievements to differ from the future
results,  performance  (financial  or  operating)  or  achievements expressed or
implied  by such forward-looking statements.  Such future results are based upon
management's  best  estimates  based upon current conditions and the most recent
results  of  operations.  Such  factors  include,  among  others:

*     The Company's ability to continue as a going concern will be determined
by its ability to obtain additional funding and to implement its business plan.

*     If  financing  does  not  become  available  on  favorable terms, then the
Company  will  not have adequate funds to fulfill its long-term strategic plans.

*     The  Company  may  not  be  able  to  manage  its  expansion  growth plan.

*     The  Company  may  not  be  able  to  manage  its  expanding  operations
effectively.

*     The  Company  does  not  maintain  key man life insurance on its principal
employees.

*     The  Company  may  not  be  able  to  attract, motivate and retain skilled
employees to install pavers, or to engage sufficient outside contractors to meet
the  Company's  planned  expansion  needs.

*     The Company is dependent upon several key customers and the loss of any of
these  key  customers  could  cause a material, negative effect on its financial
condition.

*     The  Company  requires a high volume of quality products that are procured
from, and assembled by, third party suppliers and reliance on suppliers, as well
as  industry  supply conditions generally, involves several risks, including the
possibility  of  defective  product, shortage of product, increases in costs and
reduced  control  over  delivery  schedules, any or all of which could adversely
affect  the  Company's  financial  results.

*     The  Company  may not be able to collect accounts receivable or may retain
inadequate  reserves  for  bad  debt.

*     There  can  be  no  assurance that shareholders of the Company will not be
negatively  affected  by  the concentration of ownership of its Common Shares by
the  management  and  directors  of  the  Company.

*     The  Company  faces  the  risk of default of debt obligations and negative
      impacts  of  restrictive  covenants.

*     The  Company  has  not  and  may  not pay dividends to shareholders in the
      foreseeable  future.

*     The  Company  could  face  claims of product liability, personal injury or
      other  legal  claims.

<PAGE>

*     Competition may become more intense as a result of the introduction of new
      competitors, consolidation, price discounting, and possibly weakening
      demand.

*     New  laws  and  regulations could negatively impact the paver installation
      industry, causing increased costs and decreased revenue earning
      opportunities.

*     Sales  of the Company's common stock in the public market could impair the
      market  price  of  our  common  stock  and  also  impair the ability to
      complete successful  financing  efforts.

*     The  Company must comply with penny stock regulations which may render the
      sale  of  shares  of  common  stock  by  a  stockholder  more  difficult.

ITEM  3.     QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK.

             Not  applicable.

ITEM  4.     CONTROLS AND PROCEDURES


Quarterly evaluation of the Company's Disclosure Controls and Internal Controls.
Within the 90 days prior to the date of this Quarterly Report on Form 10-QSB,
the Company evaluated the effectiveness of the design and operation of its
"disclosure controls and procedures" (Disclosure Controls), and its "internal
controls and procedures for financial reporting" (Internal Controls). This
evaluation (the Controls Evaluation) was done under the supervision and with the
participation of management, including our Chief Executive Officer (CEO) and
Chief Financial Officer (CFO). Rules adopted by the SEC require that in this
section of the Quarterly Report we present the conclusions of the CEO and the
CFO about the effectiveness of our Disclosure Controls and Internal Controls
based on and as of the date of the Controls Evaluation.

CEO and CFO Certifications. Appearing immediately following the Signatures
section of this Quarterly Report there are two separate forms of
"Certifications" of the CEO and the CFO. The first form of Certification is
required in accord with Section 302 of the Sarbanes-Oxley Act of 2002 (the
Section 302 Certification). This section of the Quarterly Report which you are
currently reading is the information concerning the Controls Evaluation referred
to in the Section 302 Certifications and this information should be read in
conjunction with the Section 302 Certifications for a more complete
understanding of the topics presented.

Disclosure Controls and Internal Controls. Disclosure Controls are procedures
that are designed with the objective of ensuring that information required to be
disclosed in our reports filed under the Securities Exchange Act of 1934
(Exchange Act), such as this Quarterly Report, is recorded, processed,
summarized and reported within the time periods specified in the Securities and
Exchange Commission's (SEC) rules and forms. Disclosure Controls are also
designed with the objective of ensuring that such information is accumulated and
communicated to our management, including the CEO and CFO, as appropriate to
allow timely decisions regarding required disclosure. Internal Controls are
procedures which are designed with the objective of providing reasonable
assurance that (1) our transactions are properly authorized; (2) our assets are
safeguarded against unauthorized or improper use; and (3) our transactions are
properly recorded and reported, all to permit the preparation of our financial
statements in conformity with generally accepted accounting principles.

Limitations on the Effectiveness of Controls. The Company's management,
including the CEO and CFO, does not expect that our Disclosure Controls or our
Internal Controls will prevent all error and all fraud. A control system, no
matter how well conceived and operated, can provide only reasonable, not
absolute, assurance that the objectives of the control system are met. Further,
the design of a control system must reflect the fact that there are resource
constraints, and the benefits of controls must be considered relative to their
costs. Because of the inherent limitations in all control systems, no evaluation
of controls can provide absolute assurance that all control issues and instances
of fraud, if any, within the Company have been detected. These inherent
limitations include the realities that judgments in decision-making can be
faulty, and that breakdowns can occur because of simple error or mistake.
Additionally, controls can be circumvented by the individual acts of some
persons, by collusion of two or more people, or by management override of the
control. The design of any system of controls also is based in part upon certain
assumptions about the likelihood of future events, and there can be no assurance
that any design will succeed in achieving its stated goals under all potential
future conditions; over time, control may become inadequate because of changes
in conditions, or the degree of compliance with the policies or procedures may
deteriorate. Because of the inherent limitations in a cost-effective control
system, misstatements due to error or fraud may occur and not be detected.

<PAGE>

Scope of the Controls Evaluation. The CEO/CFO evaluation of our Disclosure
Controls and our Internal Controls included a review of the controls' objectives
and design, the controls' implementation by the Company and the effect of the
controls on the information generated for use in this Quarterly Report. In the
course of the Controls Evaluation, we sought to identify data errors, controls
problems or acts of fraud and to confirm that appropriate corrective action,
including process improvements, were being undertaken. This type of evaluation
will be done on a quarterly basis so that the conclusions concerning controls
effectiveness can be reported in our Quarterly Reports on Form 10-Q and Annual
Report on Form 10-K. Our Internal Controls are also evaluated on an ongoing
basis by our independent auditors in connection with their audit and review
activities. The overall goals of these various evaluation activities are to
monitor our Disclosure Controls and our Internal Controls and to make
modifications as necessary; our intent in this regard is that the Disclosure
Controls and the Internal Controls will be maintained as dynamic systems that
change (including with improvements and corrections) as conditions warrant.

Among other matters, we sought in our evaluation to determine whether there were
any "significant deficiencies" or "material weaknesses" in the Company's
Internal Controls, or whether the Company had identified any acts of fraud
involving personnel who have a significant role in the Company's Internal
Controls. This information was important both for the Controls Evaluation
generally and because items 5 and 6 in the Section 302 Certifications of the CEO
and CFO require that the CEO and CFO disclose that information to our Board's
Audit Committee and to our independent auditors and to report on related matters
in this section of the Quarterly Report. In the professional auditing
literature, "significant deficiencies" are referred to as "reportable
conditions"; these are control issues that could have a significant adverse
effect on the ability to record, process, summarize and report financial data in
the financial statements. A "material weakness" is defined in the auditing
literature as a particularly serious reportable condition where the internal
control does not reduce to a relatively low level the risk that misstatements
caused by error or fraud may occur in amounts that would be material in relation
to the financial statements and not be detected within a timely period by
employees in the normal course of performing their assigned functions. We also
sought to deal with other controls matters in the Controls Evaluation, and in
each case if a problem was identified, we considered what revision, improvement
and/or correction to make in accord with our on-going procedures.

In accord with SEC requirements, the CEO and CFO note that, since the date of
the Controls Evaluation to the date of this Quarterly Report, there have been no
significant changes in Internal Controls or in other factors that could
significantly affect Internal Controls, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Conclusions. Based upon the Controls Evaluation, our CEO and CFO have concluded
that, subject to the limitations noted above, our Disclosure Controls are
effective to ensure that material information relating to Intel and its
consolidated subsidiaries is made known to management, including the CEO and
CFO, particularly during the period when our periodic reports are being
prepared, and that our Internal Controls are effective to provide reasonable
assurance that our financial statements are fairly presented in conformity with
generally accepted accounting principles.


PART  II:     OTHER  INFORMATION.

ITEM  1.     LEGAL  PROCEEDINGS.

     The Company is presently a defendant in 25 collection related lawsuits
totaling approximately $520,000 some of which judgements have been obtained and
the rest are pending. The majority of these legal actions are a result of the
company's discontinued operations. In addition, there are presently 18
threatened collection related lawsuits totaling approximately $200,000.

ITEM  2.     CHANGES  IN  SECURITIES  AND  USE  OF  PROCEEDS.

     During the six months ended June 30, 2003, the Company issued 2,397,800
shares of common stock to consultants for services. The shares were valued at
$248,591, the fair value on the respective grant dates.

     During the six months ended June 30, 2003, the Company issued 600,000
restricted shares of common stock as collateral for services performed by a
vendor. These shares have not yet been applied as payment for amounts owed.

<PAGE>

     During the six months ended June 30, 2003, the Company issued 2,066,500
option shares pursuant to its stock option plans as collateral for services
performed by consultants and vendors. Of these, 105,700 option shares were
exercised and valued at $10,570 based on the dates exercised. The remaining
1,960,800 option shares were collateral at June 30, 2003.

     During the six months ended June 30, 2003, the Company issued 15,000,000
restricted shares of common stock to purchase commercial equipment inventory in
conjunction with its equipment re-sale subsidiary, PSC Equipment, Inc. The
shares were valued at $1,350,000, based on the date of the equipment purchase
transaction.

     Subsequent to June 30, 2003, 300,000 of previously issued option shares
were exercised by consultants and vendors and applied as payment for amounts
owed. The option shares were valued at $24,000 based on the dates of exercise

     Subsequent to June 30, 2003, the Company issued 720,000 shares to
consultants and vendors pursuant to its stock option plans, as payment for fees
owed. The shares were valued at $51,300 based on the dates of issuance.

     Subsequent to June 30, 2003, the Company issued 925,000 option shares to
consultants and vendors pursuant to its stock option plans, as collateral for
services to be performed. These option shares have not yet been exercised as
payment for amounts owed.

ITEM  3.     DEFAULTS UPON SENIOR SECURITIES.

             None

ITEM  4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

             None.

ITEM  5.     OTHER INFORMATION.

             Not applicable.

ITEM  6.     EXHIBITS AND REPORTS ON FORM 8-K.

          (a)     Exhibits.
                  --------

     99.1 (CEO) Certification Pursuant to 18 U.S.C. Section 1350, As Adopted
          Pursuant  to  Section  906  of  the  Sarbanes-Oxley  Act  of  2002

     99.2 (CFO)  Certification  Pursuant  to  18 U.S.C. Section 1350, As Adopted
          Pursuant  to  Section  906  of  the  Sarbanes-Oxley  Act  of  2002


     _________________
     (b)     Reports  on Form 8-K.  The Company did not file any reports on Form
8-K  during  the fiscal quarter.

<PAGE>


                                   SIGNATURES

     Pursuant  to  the  requirements of the Securities Exchange Act of 1934, the
registrant  has  duly  caused  this  report  to  be  signed on its behalf by the
undersigned  hereunto  duly  authorized.
PAVING  STONE  CORPORATION



                 By:  /s/  Jace  Simmons
                      --------------------
                      Jace  Simmons,  Executive  Vice  President-Finance,
                      Chief Financial Officer and Director
                      (Duly Authorized Officer and Principal Financial Officer)
                      Dated:  November  12,  2003

<PAGE>

                                  CERTIFICATION

 I,  Maurice  F.  Sigouin,  certify  that:

     1.   I  have  reviewed  this  quarterly report on Form 10-Q of Paving Stone
          Corporation;

     2.   Based  on  my  knowledge,  this  quarterly report does not contain any
          untrue  statement  of a material fact or omit to state a material fact
          necessary  to  make the statements made, in light of the circumstances
          under  which such statements were made, not misleading with respect to
          the  period  covered  by  this  quarterly  report;

     3.   Based  on  my knowledge, the financial statements, and other financial
          information  included  in this quarterly report, fairly present in all
          material  respects  the financial condition, results of operations and
          cash  flows of the registrant as of, and for, the periods presented in
          this  quarterly  report;

     4.   The  registrant's  other certifying officers and I are responsible for
          establishing  and  maintaining  disclosure controls and procedures (as
          defined  in  Exchange  Act Rules 13a-14 and 15d-14) for the registrant
          and  we  have:

          a)   designed  such  disclosure controls and procedures to ensure that
               material  information  relating  to the registrant, including its
               consolidated  subsidiaries,  is made known to us by others within
               those  entities,  particularly  during  the  period in which this
               quarterly  report  is  being  prepared;

          b)   evaluated  the  effectiveness  of  the  registrant's  disclosure
               controls  and procedures as of a date within 90 days prior to the
               filing date of this quarterly report (the "Evaluation Date"); and

          c)   presented  in  this  quarterly  report  our conclusions about the
               effectiveness  of the disclosure controls and procedures based on
               our  evaluation  as  of  the  Evaluation  Date;

     5.   The registrant's other certifying officers and I have disclosed, based
          on  our  most  recent evaluation, to the registrant's auditors and the
          audit  committee  of  registrant's  board  of  directors  (or  persons
          performing  the  equivalent  function):

          a)   all  significant  deficiencies  in  the  design  or  operation of
               internal  controls  which could adversely affect the registrant's
               ability  to  record, process, summarize and report financial data
               and  have  identified  for the registrant's auditors any material
               weaknesses  in  internal  controls;  and

          b)   any  fraud,  whether or not material, that involves management or
               other  employees  who have a significant role in the registrant's
               internal  controls;  and

     6.   The  registrant's  other  certifying  officers and I have indicated in
          this quarterly report whether or not there were significant changes in
          internal  controls or in other factors that could significantly affect
          internal  controls  subsequent  to  the  date  of  our  most  recent
          evaluation,  including  any  corrective  actions  with  regard  to
          significant  deficiencies  and  material  weaknesses.

                                        /s/  Maurice  F.  Sigouin
                                        -------------------------
                                        Maurice  F.  Sigouin
Date: November  12,  2003               Chief Executive  Officer

<PAGE>




                                  CERTIFICATION

I,  Jace  Simmons,  certify  that:

     1.   I  have  reviewed  this  quarterly report on Form 10-Q of Paving Stone
          Corporation;

     2.   Based  on  my  knowledge,  this  quarterly report does not contain any
          untrue  statement  of a material fact or omit to state a material fact
          necessary  to  make the statements made, in light of the circumstances
          under  which such statements were made, not misleading with respect to
          the  period  covered  by  this  quarterly  report;

     3.   Based  on  my knowledge, the financial statements, and other financial
          information  included  in this quarterly report, fairly present in all
          material  respects  the financial condition, results of operations and
          cash  flows of the registrant as of, and for, the periods presented in
          this  quarterly  report;

     4.   The  registrant's  other certifying officers and I are responsible for
          establishing  and  maintaining  disclosure controls and procedures (as
          defined  in  Exchange  Act Rules 13a-14 and 15d-14) for the registrant
          and  we  have:

          a)   designed  such  disclosure controls and procedures to ensure that
               material  information  relating  to the registrant, including its
               consolidated  subsidiaries,  is made known to us by others within
               those  entities,  particularly  during  the  period in which this
               quarterly  report  is  being  prepared;

          b)   evaluated  the  effectiveness  of  the  registrant's  disclosure
               controls  and procedures as of a date within 90 days prior to the
               filing date of this quarterly report (the "Evaluation Date"); and

          c)   presented  in  this  quarterly  report  our conclusions about the
               effectiveness  of the disclosure controls and procedures based on
               our  evaluation  as  of  the  Evaluation  Date;

     5.   The registrant's other certifying officers and I have disclosed, based
          on  our  most  recent evaluation, to the registrant's auditors and the
          audit  committee  of  registrant's  board  of  directors  (or  persons
          performing  the  equivalent  function):

          a)   all  significant  deficiencies  in  the  design  or  operation of
               internal  controls  which could adversely affect the registrant's
               ability  to  record, process, summarize and report financial data
               and  have  identified  for the registrant's auditors any material
               weaknesses  in  internal  controls;  and

          b)   any  fraud,  whether or not material, that involves management or
               other  employees  who have a significant role in the registrant's
               internal  controls;  and

     6.   The  registrant's  other  certifying  officers and I have indicated in
          this quarterly report whether or not there were significant changes in
          internal  controls or in other factors that could significantly affect
          internal  controls  subsequent  to  the  date  of  our  most  recent
          evaluation,  including  any  corrective  actions  with  regard  to
          significant  deficiencies  and  material  weaknesses.


                                         /s/ Jace Simmons
                                        -------------------------
                                         Jace Simmons
Date: November  12,  2002                Executive Vice President Finance
                                         and Chief Financial Officer

<PAGE>


ITEM  2.         DISCUSSION  AND  ANALYSIS  OF FINANCIAL CONDITION AND
RESULTS  OF  OPERATIONS.

OVERVIEW

     The following discussion should be read in conjunction with the unaudited
consolidated condensed financial statements and notes thereto included under
Item 1 above. In addition, reference should be made to the Company's audited
consolidated financial statements and notes thereto and related Management's
Discussion and Analysis of Financial Condition and Results of Operations
included in the Company's most recent Annual Report on Form 10-K.

     During the second quarter of 2003, we formed a new subsidiary, PSC
Equipment, Inc., to buy and sell high grade commercial equipment. This
illustrates our continuing shift away from the unprofitable paver installation
business. To begin this new division, we purchased high grade food processing
equipment located in four sites around the USA with an appraised resale value of
$20,000,000. We issued 15,000,000 restricted common shares and executed a
$500,000 money purchase contract as consideration for this purchase. This
equipment is valued at cost on our June 30, 2003 balance sheet at $1,350,000.
During the third quarter of 2003, we purchased an additional $14,000,000 of
similar equipment (appraised resale value) and recorded a sale of $7,000,000.
This transaction is disclosed as a subsequent event in the footnotes to the
financial statements, and generated an individual profit of $3,900,000 in the
third quarter of 2003. We continue to aggressively market our equipment
inventory for resale and continue to search for new equipment inventory to
purchase.

     The following explanations reflect continuing operations, comprised of our
paver installation divisions in California, Arizona, Nevada and the
Mid-Atlantic, and our newly formed equipment resale division.


FINANCIAL  CONDITION

     Total assets from continuing operations as of June 30, 2003 were
$2,255,175, an increase of $679,935 or 43.2%, from total assets of $1,575,240 at
December 31, 2002. The increase was primarily attributable to the purchase of
equipment inventory described above totaling $1,350,000, offset by a reduction
in accounts receivable of $574,988. This reduction reflects the continued down
sizing of existing paver installation operations.

     Current liabilities from comtinuing operations increased by $851,019 or
16.4%, from $5,174,774 at December 31, 2002 to $6,025,793 at June 30, 2003. The
increase is primarily attributable to a reclassification of long-term debt to
short-term debt totaling $904,861.

     Stockholders' deficit increased from $5,663,225 at December 31, 2002 to
$6,180,466, an increased deficit of $517,242. This was a result of losses in the
six months ended June 30, 2003 of $2,115,832 of which $1,128,500 came from
discontinued operations. This was offset by increased additional paid in capital
of $1,499,132, largely a result of the $1,350,000 equipment inventory purchase
for common stock, described above

RESULTS  OF  OPERATIONS

     Net sales decreased by $2,253,242, or 55.2%, and $1,993,319 or 30.1%, for
the three month and six month periods ended June 30, 2003, respectively, as
compared to the same periods in the prior year. The decreases were primarily due
to the continued winding down of existing paver installation operations.

     Cost of goods sold decreased by $1,172,070, or 43.9%, and $932,656 or
21.0%, for the three month and six month periods ended June 30, 2003,
respectively, as compared to the same periods in the prior year. The decreases
were primarily due to the continued winding down of existing paver installation
operations

<PAGE>

     Selling, general and administrative expenses decreased by $777,063, or
48.3%, and $817,278 or 31.4%, for the three month and six month periods ended
June 30, 2003, respectively, as compared to the same periods in the prior year.
The decreases were primarily due to the continued winding down of existing paver
installation operations.

     We incurred a net loss from continuing operations of $668,713 for the
three-month period ended June 30, 2003 as compared to a net profit of $310,324
for the three-month period ended June 30, 2002. The reduction of $979,037 was
primarily due to the continued winding down of existing paver installation
operations.

     We incurred a net loss from continuing operations of $987,332 for the
six-month period ended June 30, 2003 as compared to a net profit of $79,104 for
the six-month period ended June 30, 2002. The reduction of $1,066,436 was
primarily due to the continued winding down of existing paver installation
operations.

<PAGE>

LIQUIDITY  AND  CAPITAL  RESOURCES

    CONSOLIDATED BALANCE SHEET AS OF JUNE 30, 2003

Our total assets at June 30, 2003 were $2,359,273 compared with $4,088,860 at
December 31, 2002, a decrease of $1,729,587. These balances include net assets
from discontinued operations of $104,098 at June 30, 2003 and $2,513,620 at
December 31, 2002, a decrease of $2,409,522, primarily the result of the winding
down of our Florida business. Our total assets excluding discontinued operations
were $2,255,175 and $1,575,240, respectively, at June 30, 2003 and December 31,
2002, an increase of $679,935. This increase was primarily due to the equipment
inventory purchase described above totaling $1,350,000, offset by a decrease in
net accounts receivable of $574,988, which was due to the winding down of
existing paver installation operations. Total assets at June 30, 2003 were
comprised mainly of $686,813 of accounts receivable, $1,350,000 of equipment
inventory and $146,801 of property and equipment. Total assets at December 31,
2002 were comprised principally of $1,261,801 of accounts receivable, $159,335
of cost in excess of billings on uncompleted contracts and $108,111 of property
and equipment. Total current assets at June 30, 2003 and December 31, 2002
amounted to $2,204,505 and $3,955,133, respectively, while total current
liabilities for those same periods amounted to $8,539,739 and $8,847,224
respectively, creating working capital deficits of $6,335,234 and $4,892,091,
respectively. These working capital deficits are principally attributable to
operating losses in the first two quarters of 2003 and in the full year of 2002.
Total liabilities at June 30, 2003 and December 31, 2002 were $8,539,739 and
$9,752,085, respectively, representing a decrease of $1,212,346. This decrease
is primarily due to a decrease in liabilities from discontinued operations of
$1,158,504, caused primarily by the winding down of operations in Florida.
Shareholders' deficit at June 30, 2003 and December 31, 2002 was $6,180,466 and
$5,663,225, respectively, representing an increased deficit of $517,241. The
increased deficit is due to losses in the first two quarters of 2003, offset by
the equipment inventory purchase for common stock described above.


During the second quarter of 2003, we received no significant outside financing.
The Company's net cash provided from operating activities for the six months
ended June 30, 2003 was $162,118 compared to cash used in operating activities
of $852,573 for the six months ended June 30, 2002, an increase of $1,014,691.
This increase resulted from the discontinuance of unprofitable paver
installation operations.

Our Company used no cash in investing activities for the six months ended June
30, 2003, as compared to $9,442 used in investing activities for the six months
ended June 30, 2002.

Our Company's net cash used in financing activities for the six months ended
June 30, 2003 was $36,433, compared to $1,115,352 net cas provided for the six
months ended June 30, 2002, a decrease of $1,151,785. The only source of
financing in 2003 was $4,422 from our revolving line of credit. The primary
sources of financing in 2002 were cash proceeds of $1,000,000 from an issuance
of stock and cash proceeds of $268,215 from our revolving line of credit.


Our Company had a revolving line of credit with a financial institution totaling
$2,500,000, which was up for renewal at April 30, 2003. The financial
institution declined to renew the line and is currently in negotiations with our
Company to restructure the debt. We believe this negotiation will be
successfully concluded by November 30, 2003.

<PAGE>

The report of our independent accountants on our December 31, 2002 financial
statements includes an explanatory paragraph indicating that there is
substantial doubt about our ability to continue as a going concern due to
substantial recurring losses from operations and a significant accumulated
deficit and working capital deficit. Our ability to continue as a going concern
will be determined by our ability to obtain additional funding and to implement
our business plan, particularly pertaining to the new equipment resale division.
Our financial statements do not include any adjustments that might result from
the outcome of this uncertainty.


Our Company has no assured available financial resources to meet its June 30,
2003 working capital deficit of $6,335,234 and future operating costs. If our
Company is unable to fund its working capital deficit and future operating costs
through operating activities, the Company may be required to change its proposed
business plan and decrease its planned operations, which could have a material
adverse effect upon its business, financial condition, or results of operations.